Fridays With Rogers Partners

At this morning’s muffin meeting, Matthew Umbrio discussed a case in which the plaintiffs attempted to back out of a settlement.

In Huma et al v. Mississauga Hospital and Queensway Health Centre, 2019 ONSC 5115, the plaintiffs commenced a medical negligence lawsuit. A lawyer assisted with drafting the Statement of Claim but was never formally retained.

Counsel for the defendant physicians offered to forego costs in exchange for a dismissal of the action. One of the plaintiffs, on behalf of all plaintiffs, wrote to defence counsel accepting the offer.

After retaining counsel, the plaintiffs took the position that there was no legally binding settlement agreement. They argued that they did not intend to finalize a settlement agreement.

Justice Sossin disagreed. The terms of the settlement were clear.

Further, although the wording of releases was not agreed to, Justice Sossin indicated that the releases constituted the mechanism for implementing the settlement, but did not form part of the settlement itself.

Justice Sossin also rejected the argument that the settlement was unconscionable. There was no evidence on the likelihood of the plaintiffs succeeding in establishing liability and an entitlement to damages.

As a result, the defendants’ motion to enforce the settlement was successful.

Ankita Abraham addressed a priority dispute decision. In Continental Casualty Company v. Chubb Insurance Company of Canada, 2019 ONSC 4773, the claimant had a personal automobile policy with Chubb and was also the owner and executive of a company that had automobile insurance with CNA. The CNA policy had optional benefits.

While the claimant was in the hospital, both Chubb and CNA were contacted. CNA erroneously advised that there was no optional coverage. Further, CNA stated that the claimant was not entitled to claim benefits under the CNA policy. The claimant submitted an application for benefits to Chubb.

Chubb disputed priority. The arbitrator held that CNA was the priority insurer.

The arbitrator found that the claimant was a deemed named insured under the CNA policy based on the “regular use” provisions in the Statutory Accident Benefits Schedule.

He reached this conclusion because, as president and CEO of the company, the claimant had control and access to the company’s vehicles whenever he wanted.

Justice Stinson overturned the decision. He stated that it was unreasonable for the arbitrator to impute regular use when none existed.

There was no evidence of the company’s vehicles being made available for the claimant’s regular use. The claimant had never used a company vehicle prior to or at the time of the accident.

Another issue was that the CNA policy contained an OPCF 47 endorsement which provided that CNA could not rely on the priority rules in the Insurance Act.

However, the endorsement only applied in relation to the claimant. It did not address the impact on priority disputes between insurers.

As a result, Justice Stinson held that CNA must pay both standard and optional benefits to the claimant. However, CNA is entitled to reimbursement from Chubb for the standard benefits paid to the claimant and associated expenses. CNA is required to pay the cost of all optional benefits.